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Living Services: The next wave in the digitization of everything

A new report explains how the digitization of everything and liquid consumer expectations are creating the next wave of digital transformation.

What are Living Services?

The Era of Living Services

Fjord launches a ground-breaking report on the next wave in the digitization of everything.

Everyone's heard of the Internet of Things (IoT), but how will businesses and brands use it? How will health services, transportation, insurance, utilities and security companies, for example, evolve to match our increasingly liquid demands and expectations in a world where almost everything is digitized?

These questions are answered in this ground-breaking report on the future of everyday life by Fjord, which envisages how businesses from oil companies to retailers will create entirely new types of customer service or ways of working.

Mark Curtis, Fjord’s Chief Client Officer, describes the evolution of Living Services, the impact they will have on our lives and the technology underpinning their rise.

The Era of Living Services describes how brands will use the Internet of Things and powerful data analytics to create services that come to life—predicting and reacting to consumers’ changing needs and circumstances.

In other words, branded services that are personalized and change in real-time for every individual wherever they are and whatever they are doing. It looks at the effect Living Services will have on most aspects of our lives—from our homes, finances and work, to our health, shopping and the future of travel.

Most importantly, the report predicts a wholesale transition from one-size-fits-all services to the delivery of mass-service customization—marking a revolutionary shift in the relationship between the customer and service providers, and demanding a wholesale re-appraisal of current business structures and operational relationships.

Forces Driving Living Services

Many of the conceptual ideas behind Living Services have been with us for decades. So what is new? These concepts are now deliverable at scale. What's more, they are becoming an imperative driven by two forces:

The Digitization of Everything

Liquid Consumer Expectations

Read Baiju Shah's blog posts in the The Economist blog "Lean back," to get an in-depth view on liquid expectations:

The age of Living Services

Living Services is the next major wave of transformative digital services. Like the desktop Web wave of the 1990s and the mobile wave of the 2000s, Living Services breathes life into the Internet of Things—harnessing the next wave of technology to transform businesses and society alike.

Living Services is defined by, and designed around, the needs of individuals—not generic services defined by companies for mass consumption.

Within five years, sensors, the cloud, connected smart devices and real-‐time analytics will combine to deliver indispensable and highly customized digital services to consumers. These services will touch every aspect of our lives—from the home, to finances, education, shopping, transportation and much more.

How will Living Services change our lives?

Much of what happens with Living Services will happen in the background, so consumers won’t necessarily be consciously engaged—even as they reap the benefits Living Services can bring.

There are few areas of our lives set to benefit more from Living Services than our homes. From more efficient energy management, to smart alarms that allow us to monitor security from anywhere in the world, to a suite of fully customized, on-demand entertainment and media options, the home could emerge as the source from where our complex digital lives can be unified and simplified.

The connected car is, in effect, a new digital platform within consumers’ personal digital service ecosystem. Connected cars will need to act like and interoperate with other touch points such as PCs, smartphones, tablets, wearables and their associated services.

Self-driving vehicles

Energy efficiency

Navigation and location

Insurance cost reduction

Enhanced driving and passenger experience

Interoperability with devices

Finances

Customer’s experience of financial services can be defined by their personal timeline: past, present and future. With data analytics at the heart of Living Services, predictive financial services will help consumers organize and prioritize their financial lives based on a customized and consolidated view of every aspect of their financial health and well-being—banking, insurance, payments, investments, loans, shopping, and more.

Timeline banking (past/present/future)

Self-checking statements

Moving money made seamless

Insurance reinvented as risk goes live

Shopping decision making

Investment advice

Mortgage journey extended

Our health

Living Services will have a profound impact on health and wellness—enabling the shift from reactive treatment of issues to proactive prevention of problems, and a simultaneous shift from population-based diagnostics and prescriptions to those based on individuals.

We’re just beginning to scratch the surface for applications in health care. The opportunities are transformational and seemingly limitless:

Home-based consultation and care

Prescription dosing and monitoring

Remote care for the elderly and disabled

Safety monitoring

Fitness and dietary advice

Training

Illness diagnostics

Safety and monitoring

Personal health diary

Remote care for at-risk people

Trend to taking greater responsibility

Our work

Living Services will likely transform how we work—with enhanced digital devices and services to help us better manage our workloads in the office, on the road, and at home.

Workplace wearables, for example, will monitor our levels of alertness and well-being—helping us boost productivity, for example, by scheduling harder tasks when we are at our peak.

From smart sensors that allow workers to communicate with complex machinery in real-time, to custom devices designed to work from the point of view of individual workers, Living Services can radically transform employee productivity and workplace interaction.

Travel arrangements

Workload management

Recommendations for learning and reading

Resource management

Productivity suggestions

Workplace health

Decision-making advice

How will brands be impacted by Living Services?

Living services will start to change the dynamic between customers and brands to one that is more consumer-centric and relationship based. Personalization and purpose are critical to winning consumer affection in this digital age.

Brands that atomize—allow elements of what they offer to be super-distributed by other services, or which allow other services to connect into what they offer—are most likely to survive and thrive within the digital service landscape.

This is a world where the rules of branding and conventional business structures are fundamentally challenged and disrupted—where services appear intuitively to offer themselves to consumers according to the time, place or situation where they find themselves.

Living Services will talk to us. They will know us. They will entertain us, assist us and protect us. They will respond by wrapping around us—constantly learning about our needs, intents and preferences, so they can flex and adapt to become more relevant, engaging and useful.

How will Living Services impact businesses?

From transport to retail, from healthcare to utilities, every business must now be a digital business. The arrival of Living Services opens up vast potential for businesses to transform their offerings, operations, and relationships with customers.

Yet it also creates great challenges. Here are the seven, biggest challenges organizations will face as Living Services disrupt the status quo:

Designing for Living Services

In many cases, Living Services will require companies to adopt a new design philosophy—one that is rooted in behavioral and contextual data optimization. In other words, it will require a paradigm shift from designing one experience for many, to designing many experiences for one—with constantly changing needs.

The design of Living Services will not just be about the elegant use of data and technology to solve a problem, or to save time. Designers and developers will also be informed by the way humans react to particular scenarios—tuned to consider how our brains work.

Traditionally, services have been designed to operate in perfect isolation as if the outside world had no impact on the customer’s experience of them. For Living Services, the outside world may directly influence and shape the service experience.

For example, a service could listen for external data such as geographic location, proximity to travel, retail, utility providers, time of day, weather and travel updates, local and national events, and so on. This external data will directly influence and, in some cases, be vital to a positive customer experience.

Designing for human bandwidth

In parallel to the radical shift from static to continuous service design informed by individualized data analytics, Living Services will profoundly change the way we physically access and interact with digital services—less clinical and mechanic, and more organic, fitting naturally into our everyday behavior.

We have already seen a move away from point-and-click devices towards touch screens, but we will also increasingly see our bodies being used as both a controller and an interface. Body language will become an increasingly important element of service design, especially as we move into a mixed environment of screens and objects that don't have screens.

Forward-thinking companies are already thinking not simply about the devices themselves, but about the service flowing through it.

Human to machine body language

The rise of PCs, laptops and mobile phones has created a revolution in remote communications—a world where body language seams less important. Cultural variations aside, “reading” other people through their body language occurs every day—all over the world, consciously or unconsciously.

In parallel to the use of Natural User Interfaces (NUI), body language will become a significant component in design for Living Services.

Privacy & Ethics

Living Services draws on multiple real‐time personal data‐feeds, blended with third‐party information, to create custom services and interactions for the consumer. This inevitably raises questions around privacy and ethics. Who will own and have access to all this highly sensitive data?

Living Services will transform the way consumers interact with brands, including how much and when consumers will share information or receive services based on personal data. The emphasis will start to move away from consumers learning about brands, to one where brands have to make an effort to get to know consumers as individuals.

Brands that successfully build one‐to‐one relationships with their customers may well become trusted partners.

For companies to succeed in this new relationship paradigm, they must first reduce the implicit costs of Living Services by increasing:

Transparency: Let customers see what is happening with their data

User autonomy: Let users control their data

Security: Don’t leave holes in customer’s personal network

Second, brands need to boost the explicit benefit of Living Services by increasing, as appropriate:

Personalization: Shape services around the customer

Adaptation: Understand changing external context

Automation: Remove unnecessary cognitive load from the customer

Given the attitude of millennials to privacy, we think the question “How will brands respect my data and personal privacy?” instead becomes “How do I want to be known?”

Practical and perceived privacy

While Living Services offer obvious benefits to consumers, they do so at a cost. For example, if smartphones log user locations without their knowledge or permission, this represents a cost to consumers—which could be practical (what does this mean for my safety and security?), or perceived (this is an unacceptable breach of my privacy).

For context aware services, and the brands responsible for them, to be successful, the benefits in terms of utility, automation, pleasure, beauty and new perspective must always outweigh the costs—which could be loss of control, lack of privacy, distraction or anxiety.

"A recent survey from Accenture Interactive revealed that 23 percent were deterred from purchasing smart technology for the home, and 19% hadn't purchased wearable technology, due to privacy concerns."

Ethics: Motivation vs. freedom

Consumer privacy is just one example of the wider social and moral issues raised by the emergence of smart, contextually aware digital services. The increase in services that can track, monitor and learn about intimate aspects of our lives raises important ethical issues that will need to be addressed by brands and service designers.

These issues will vary by sector and industry, but here are three sectors where the potential uses of data via Living Services are already beginning to emerge:

Health and wellness

As consumers opt to use wearable devices to track their health and well-being, insurance companies may seek to price their services around that flow of data.

From an ethics perspective, will society permit the calculation of premiums based on how well an individual is taking care of themselves? And to what extent is it okay for the private or public sector to proactively motivate individuals to look after their bodies by behaving in certain ways through financial incentives?

The connected car

Similar to wearables, connected cars can capture and stream data in real-time, building a historical stream of driver behavior, including location, speed, distance traveled, and more.

Connected cars raise a plethora of ethical questions around insurance costs and safety. Can insurance companies raise premiums based on dangerous driving habits? Does law enforcement have a responsibility for commuter safety by remotely curtailing or stopping dangerous drivers?

The connected home and family

We are fast approaching a point where parents can monitor their children remotely while they’re at school or participating in other activities away from the home.

Apps that capture real-time data about child behavior raise the question whether this infringes on children’s right to privacy, and whether it discourages independence.

Summary

Living Services possesses unrivaled potential to enrich our lives—health, home, work, travel, education, and more—in ways unimaginable just a few years ago. The next major wave of transformative digital services is poised to change our lives both culturally and commercially.

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